Calculate the dividend distribution

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Question - ABC Inc. has 12% preferred stocks with a total par value of $200,000, and common stocks with a total par value of $100,000. In year 1 ABC declared and distributed $16,000 cash dividends, in year 2 it did not declare any dividends, and in year 3 ABC declared and distributed $76,000 cash dividends.

Required - Calculate the dividend distribution (preferred and common) for year 3 assuming the preferred stock is cumulative and participates up to 16%.

Reference no: EM132534122

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